The new normal is that you might have to completely change your business or tweak your business model.
Al-Rasheed, who will on Tuesday address the Top CEO Conference at KAEC about the challenges of slow growth, said that the private sector should forget about the “business as usual” concept.
This is especially important given that boosting the private sector contribution is among the main objectives of Saudi Arabia’s Vision 2030 reform plan.
“I will talk about Vision 2030 and how the private sector should forget about business as usual,” he told Arab News in an interview on Monday.
“The new normal is that you might have to completely change your business or tweak your business model… I will be talking about how the private sector should adapt to (that).”
Entrepreneurship is one of the main faces of the private sector in the Kingdom. The Global Entrepreneurship Monitor (GEM) recently stated that 80 percent of Saudis see entrepreneurship as an opportunity, which makes it rank as the top in the world.
“We believe that entrepreneurship is the way forward,” Al-Rasheed said, adding that attracting 100 entrepreneurs can create about 700 companies, as each entrepreneur can be involved in several businesses in their lifetime as well as working with other entrepreneurs.
“They’ll have 3,000 entrepreneurs from the people that work around them. Prince Mohammed bin Salman College of Business and Entrepreneurship (which will launch its postgraduate degrees in September 2017) is a main driver in this”.
Al-Rasheed said KAEC has big plans in leisure and tourism as the city is working on developing 40 projects. Among those are golf courts, health and wellness clubs, a carnival city, an exhibition center and a marina that
Al-Rasheed said that by 2020 KAEC will be a vibrant city with more than 40,000 residents and at least 400 corporations in operation. It will become a leisure destination with more than a million visitors a year. The rail connections will have a major impact not only in KAEC, but in the region itself. The economic city aims to create 27,000 jobs in the next three years.
“Because we are investing in sectors that don’t depend on oil or the government, we have been growing at 44 percent (in recurring revenue) per year since 2014,” Al-Rasheed said.
KAEC was launched in December 2005. Today, around 15 percent of the city has been completed. Al-Rasheed said he believes that over the next five years, about 70 million square meters of development will be completed relying solely on private funding. “The idea of giving the private sector a lead or a driver role in economic development was the strength of the idea,” Al-Rasheed said.
Last year, KAEC awarded SR1.6 billion worth of contracts, mainly domestic. Al-Rasheed said the city is expecting to award the same amount or more this year.
JEDDAH: Businesses must be ready to change during tough economic times, said Fahd Al-Rasheed, group CEO of King Abdullah Economic City (KAEC) in Saudi Arabia.